- Ethereum’s August revenue was US$39.2 million, a 30% drop from July and a 75% drop from the previous year, making it one of the network’s weakest months since 2021.
- The decline in revenue can be traced back to the Dencun upgrade in March 2024, which significantly reduced fees for Layer-2 networks, thereby lowering the revenue generated by the Ethereum mainnet.
- The revenue slump has reignited debate over Ethereum’s fundamentals, with critics claiming the network is “dying” and supporters arguing that lower fees are a necessary and beneficial feature for scaling.
Ethereum generated US$39 million (AU$58.8 million) in revenue in August, down 75% from August 2023 and 30% from August 2024. By this measure, August was among the weakest months since January 2021.
Network fees also fell month over month. Total fees declined about 20% to US$39.7 million (AU$59.6 million) from July’s US$49.6 million (AU$74.4 million).
Post-Dencun dynamics remain a key factor. The March 2024 Dencun upgrade cut costs for Layer-2 networks posting data to Ethereum, driving materially lower fees and compressing protocol revenue even as on-chain activity migrates to L2.
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Is Ethereum Dying?
The revenue slide has renewed debate on fundamentals. Critics argue falling fees and revenue signal an unsustainable model at the base layer. Supporters counter that Ethereum’s role as a settlement and data-availability backbone is intact and that lower fees are a feature for scaling, not a failure of demand.
Things got heated when a Messari researcher known as AJC claimed that Ethereum is “dying”, citing a steep drop in network revenue despite the recent price rally.
The claim prompted pushback from Ethereum supporters and even other Messari researchers. One of them pointed to tentative improvements in active addresses and in transaction counts/throughput, but AJC dismissed those counters, calling active addresses and throughput “meaningless statistics” because they do not capture whether the protocol is generating sustainable economic value.
He added that a larger stablecoin float does not help Ethereum unless on-chain velocity rises, and that continued Layer 2 expansion is not a positive on its own “if there’s no marginal user demand for another L2.”
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